January Layoffs Surge Hiring Plans Sink as Job Market Shows Early Strain in 2026

By Blessing Nweke

Fresh data on jobs and layoffs is dampening hopes that 2026 will bring quick relief for job seekers, with employers announcing more cuts and fewer hiring plans to start the year.

A monthly survey released Thursday by outplacement firm Challenger, Gray & Christmas found that U.S. employers announced 108,435 job cuts in January, the highest total for the first month of the year since 2009. By comparison, employers announced just under 50,000 cuts last January. During the depths of the Great Recession in January 2009, announced job losses exceeded 240,000.

The firm also reported the lowest level of January hiring plans since it began tracking the metric in 2009, signaling caution among employers. Andy Challenger, the company’s chief revenue officer, said the elevated cut count suggests “employers are less-than-optimistic about the outlook for 2026.”

JPMorgan, however, cautioned against drawing direct parallels to the financial crisis. While the number of cuts is the highest for January since 2009, the bank noted that this year’s figure is closer to recent January averages than to recession-era levels.

Transportation and technology led January’s announced cuts, followed by health care, driven in part by job reductions from UPS and Amazon. Amazon said last week it would eliminate 16,000 roles, while UPS plans to cut up to 30,000 jobs. Challenger said most layoffs were tied to lost contracts, economic conditions and restructuring, with only 7% attributed to artificial intelligence.

Economist Mohamed A. El-Erian called the data “sobering,” noting that layoffs are rising even as GDP grows near 4%, deepening a decoupling between economic growth and employment.

Other indicators echoed the slowdown. ADP estimated private employers added just 22,000 jobs in January, while initial unemployment claims rose by 22,000. Meanwhile, job openings continued to decline, falling by nearly a million over the past year.

As markets await the delayed January jobs report, more layoffs are already unfolding, including deep cuts announced this week at The Washington Post.